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GAO discussed a variety of measures that the Farmers Home Administration's (FmHA) county offices could take to reduce housing costs and target more assistance to very low-income households and those occupying substandard housing.

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Recommendations

Recommendations for Executive Action

Agency Affected Recommendation Status
Department of Agriculture 1. The Secretary of Agriculture should implement regulations to extend the mortgage period from 33 to 38 years and to finance manufactured/mobile homes.
Closed - Implemented
The Department of Agriculture (USDA) approved regulations to finance mobile homes in November 1986. Regulations to extend the mortgage period from 33 to 38 years were implemented on January 14, 1987.
Department of Agriculture 2. The Secretary of Agriculture should consider reducing housing costs, which include: (1) limiting housing size, establishing occupancy levels, and relating size limits and occupancy levels to the number of bedrooms in houses financed, in a manner similar to the criteria in the FmHA section 515 multifamily housing program; (2) eliminating certain features, such as bay windows, sliding glass doors, decks, and half-baths, where appropriate; (3) increasing the use of townhouses and duplexes; (4) financing houses built to the fair construction standards to ensure uniform-quality housing among all offices; and (5) increasing the financing of suitable, less expensive, existing houses from the private market.
Closed - Implemented
USDA issued an instruction on November 7, 1985, to eliminate costly features and increase the use of townhouses and duplexes. Training was given to ensure not exceeding fair construction standards. Regulations to limit house size and eliminate costly features were approved in May 1987.
Department of Agriculture 3. The Secretary of Agriculture should consider a variety of measures that could be taken to target more housing assistance to very low-income people in rural areas, which include: (1) establishing targeting performance goals for county offices; (2) pursuing a more aggressive outreach program to identify very low-income households and those living in substandard housing; and (3) following up on county office efforts to target assistance to very low-income households and those living in substandard housing.
Closed - Implemented
Discussions were held in November 1985 during training sessions to consider measures to target more housing assistance to very low-income people. Each state was requested to develop a management plan, and USDA will monitor performance during coordinated assessment trips.
Department of Agriculture 4. The Secretary of Agriculture should consider the merits of a variety of measures that could be implemented to improve targeting and reduce costs. These include pursuing a more aggressive outreach program, and revising FmHA regulations to require county offices to take appropriate measures, such as limiting housing sizes and eliminating certain features to reduce housing costs.
Closed - Not Implemented
This recommendation is no longer applicable, since USDA has taken, or is in the process of taking, action to reduce housing costs and meet targeting goals.
Farmers Home Administration 5. If FmHA finds it is unable to meet targeting goals or reduce housing costs, it should advise Congress of this.
Closed - Not Implemented
This recommendation is no longer applicable, since USDA has taken, or is in the process of taking, action to meet targeting goals.
Farmers Home Administration 6. If FmHA is unable to reduce housing costs to make housing more affordable to lower income households and reduce program costs, its should advise Congress of this.
Closed - Not Implemented
This recommendation is no longer applicable, since USDA has reduced, or is in the process of reducing, housing costs.

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